You're viewing posts tagged; "Saving, investing & banking"

11 May 2012 11:56 AM

Expect to see a proliferation of high-income bonds - sadly not the safer savings bonds issued by banks and building societies but ‘direct bonds’: fundraising IOUs struck between companies and their customers.

British companies have dipped a toe in this area and they like what they see. Income-starved savers, after all, are happy to park their money in exchange for high rates of return – even if there is no compensation safety net. And for companies this route is often cheaper than more traditional ways of raising cash for expansion.

John Lewis has already raised money offering a 6.5 per cent return - but with 2 per cent of it paid in vouchers.

07 March 2012 3:22 PM

Spare a thought for bankers. Their latest gripe is that regulators are forcing them to raise more money from savers rather than relying on those whizzy markets - you know, the ones that crunched and caused a global recession.

The British Bankers’ Association said: 'Regulators are increasingly demanding that more mortgage lending should be funded by longer term customer deposits.'

Taking from savers to lend to borrowers? A radical notion.

It continues: 'Competition for savers' funds is obliging the banks to offer ever better deals to savers willing to place deposits for more than just a few months.'

That's questionable - the best five-year fixed rate Isa a year ago was 5% - now it’s 4.5%.

Yes it's great. But let's not get all cuddly about it. Loyal customers, the throngs of us who have - willingly or simply due to a lack of choice - ploughed our savings into these banks, entrusted them with a regular stream of wages, borrowed money and paid back all the nasty interest, we don't buy that sort of garbage marketing spiel.

19 January 2012 4:01 PM

Forget buy-to-let, there may be more than a few people who read the story of the couple who bought the Whitney-on-Wye Toll Bridge, with its attached two-bedroom cottage, and thought I wish I’d invested in that.

The bridge cost £400,000 and is forecast by its new owners to generate £100,000 a year – and an 18th Century Act of Parliament when it was built granted it exemption from tax.

So, that’s a 25 per cent annual tax-free return derived from something that is also handily your home. That’s not just a potentially excellent infrastructure investment but also a prime example of the attraction of putting your money into a tangible object.

12 January 2012 3:33 PM

The battering Tesco shares have taken as spooked investors ditched them can be taken as a clear warning that 2012 has the potential for a nasty stock market crash.

Tesco delivered a trading update that was poor in terms of UK sales. The supermarket giant is struggling in its own backyard, as consumers cut back and analysts have been sniping at its sliding like-for-like UK sales.

Despite those local troubles, Tesco has been consistently growing profits at a robust rate and that has kept its share price bobbing along. What did for it this morning was a hint of caution on that.

It said: ‘We expect Group trading profit growth to be around the low end of the current consensus range.’ And thus the shares of one of our most successful companies, that many were arguing was already undervalued, plunged 15 per cent.